AD SERVING
Published: August 29, 2008
3 big changes at Google, flying dwarfs from Paris Hilton
 

The economy is giving many in digital a greater headache than previously thought, while Google is giving publishers a leg up, and Facebook may have given users more than they bargained for.

With the Olympics coming to a close and the culmination of one of the most anticipated email/text campaigns in the history of interactive, it was certainly easy to miss many of the bigger stories that shaped digital this week. Here's a recap.

The good
Monetizing traffic is seldom easy, and publishers seem to be forever looking for a better, more lucrative deal. While switching ad sales relationships is commonplace, it's not often that Google rolls out two tools designed to help publishers get the most of their inventory.

Google kicked off the week with some news about its AdSense product, saying that it would integrate data from its massive horizontal ad network into Google Analytics.

With the new tool, publishers can track the performance of their AdSense ads within their Analytics report.

Amit Agarwal at the Digital Inspiration blog predicted that some sites may go as far as to opt out of affiliate marketing programs because the new Google tool allows them to measure the performance of individual ads on each page. "This report has enormous potential as it lends a 'measurable' value to each incoming link," Agarwal wrote.

Google followed its AdSense news with the widespread release of its Ad Manager tool, which had previously been available to a select group of publishers for beta testing. The ad serving software, which lets publishers manage AdSense, third party ad networks, and their in-house sales teams through a unified platform, is thought to be an OpenX killer, according to Michael Learmonth of Silicon Alley Insider. But putting aside the implications for a startup like OpenX, which makes a similar product, the new Ad Manager should help publishers by getting them top dollar for each ad unit.

As for finding those publishers, Google made life easier for most users this week by bringing suggested queries to the main page. So will offering suggested search terms to users as they type change the game for marketers? Probably not, says Seth Besmertnik, CEO of Conductor, a natural search technology company, because Google's results will simply aggregate the leading queries on the topic.

"I expect things to get much more interesting when it suggests queries based on semantic meaning," Besmertnik says. "For instance, it's much more useful when an engine can suggest to search for 'laptops' when the searcher originally provides 'notebook' or 'notebook computers.'" 

The bad
Display may not be as sexy as search, but the market for selling ads isn't nearly as closed off, so it's worth watching the changes in that sector. Unfortunately, it seems that display is taking a bit of a beating from a sagging U.S. economy.

There's bad news at The New York Times, which reported only 1 percent growth in its digital ad revenue for last month. But from a bigger picture, display doesn't seem to be taking in the major brand dollars that many had figured on to help fuel digital's gaudy predictions for growth. While Microsoft was the biggest buyer of display ads last month, according to comScore, the list of also-rans included many lower-tier advertisers.

So, does that mean that online advertising is weaker than many had predicted. Probably not, says Calvin Lui, president and CEO of Tumri, a firm that specializes in helping advertisers make the most of their digital campaigns.

"In economically challenging times, typical trends have advertising budgets moving more towards executions and media that are more performance driven and trackable," Lui explains. "This generally results in greater online share, and within the online ecosystem, greater emphasis on performance media, pricing, and executions. We have seen many changes to budgets and plans over the last few months moving specifically in this direction."

As for the seller side, Fox Interactive edged out Yahoo for the top slot, while AOL, Microsoft and Google sites rounded out the top five.

The ugly
Want to see Paris Hilton toss a dwarf? For a certain segment of Facebook and MySpace users, that's an intriguing proposition. But for those who clicked on the ad, the result was a worm that infected the user's computer with malware. While viruses are nothing new, both MySpace and Facebook made headlines this week when news broke that worms had become an issue for the both sites.

The question is, will the threat of viruses lead to increased wariness among users? And will that in turn raise the bar for marketers who are working feverishly to attract the attention of those who would rather be playing Wordscraper, now that Scrabulous is all but dead?

Michael Estrin is deputy editor at iMediaConnection.